Orange in talks to sell fibre assets to secure approval of Jazztel deal

Orange is in talks with a number of potential buyers for some of the fibre assets it would gain as part of an acquisition of Spanish broadband provider Jazztel, as it attempts to secure regulatory approval for the deal.

According to Reuters, Nicolas Laederich, who handles regulatory affairs and competition issues for the France-based group, said a divestment would be tied to a promise to rent out capacity on the company's fixed network to whoever buys the fibre assets.

Laederich told Reuters that Orange would sell about 720,000 fibre connections installed by Jazztel in five cities in Spain. He insisted that these remedies "in no way undermine the attractiveness of the Jazztel acquisition for Orange" because about 60 per cent of the fibre connections overlap with Orange's own network.

Reuters added that the move would bring back a fourth national competitor to Spain's broadband market. Cinco Dias said in April that Yoigo, the market's smallest mobile operator, has expressed interest in buying network assets that Orange could be forced to sell to secure approval of the Jazztel deal. Other potential buyers have been cited as mobile virtual network operator (MVNO) Masmovil and regional cable companies Euskaltel and R.

European Union anti-trust regulators have given themselves until June 1 to decide whether or not to approve Orange's proposed €3.4 billion ($3.8 billion) acquisition of Jazztel.

Orange wants to buy Jazztel to improve its standing in a market that already has a strong heritage in multi-play strategies. Telefónica Movistar led the charge here with its quad-play Fusion plans that combine mobile services with fixed voice, broadband and TV, along with value-added services such as data sharing and free access to content.

Orange Spain already sells converged bundles of fixed and mobile services under Orange Kangaroo. Yoigo also sells multi-service plans under the Fusion brand.

Vodafone Spain had marketed a loosely converged fixed and mobile offering under Vodafone Integral. However, the company expanded its fixed assets with the acquisition of cable operator Ono last year and has now launched a new converged offer named Vodafone One.

Available since Apr. 20, Vodafone One provides packages of fibre, mobile broadband and TV services together with inclusive Wi-Fi access. This places it in direct competition with Movistar and ups the pressure on Orange Spain.

For more:
- see this Reuters article
- see this Vodafone One release (in Spanish)

Related Articles:
EU to decide on Orange's planned Jazztel acquisition by June 1
Orange to spend €15B on networks to drive recovery by 2018
EC's Vestager hints at closer scrutiny of future operator consolidation
EC rejects Spanish bid to review Orange's €3.4B Jazztel offer
Operators push fixed-mobile convergence and quad-play into spotlight

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